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California’s Bullet Train – A Fresh Start and a Change in Direction

09Mar2012

Written by Ken Orski

RAILSPEAK - A new strategy is beginning to emerge toward California’s embattled high-speed rail venture. The strategy is designed to rescue the project from a possible defeat at the hands of the state legislature, gain friends and supporters among local transportation agencies, win converts among independent analysts and turn around a largely skeptical public.

The plan combines the existing commitment to proceed with construction of the first rail segment in the Central Valley with near-term actions aimed at upgrading rail facilities at both ends of the proposed LA-to-SF high-speed line. Specifically, the so-called “bookend” strategy will involve “blending” high-speed rail service with commuter rail service in existing Bay Area and Southern California rail corridors.

At the northern end of the line, between San Francisco and San Jose, bullet trains would share track with Caltrain commuter trains. Both would benefit from new investments in electrification, signaling systems, bridge replacements, passing tracks and grade crossings elimination. Similar type of improvements would be introduced at the Los Angeles/Orange County/San Diego ends of the line, benefitting LA’s Metrolink and other Southern California commuter rail and transit systems.

Improving the urban “bookends” of the system will make it possible to increase the speed of local commuter trains and thus bring immediate benefits to large segments of California’s urban population. It will be a good investment whether or not the overall $98 billion high-speed rail project ever goes forward, said Will Kempton, chief executive of the Orange County Transportation Authority (OCTA) and Chairman of the independent Peer Review Group advising the High Speed Rail Authority.

The investments will be funded with a portion of Proposition 1A funds, supplemented by matching funds from local government agencies. Up to $2.3 billion in bond money and its $950 million “interconnectivity” fund would be committed to these near term improvements according to well-informed sources. This would provide approximately $1.4 billion for Southern California and $900 million for the Bay Area, assuming a 60/40 split. Another $2.7 billion has been already set aside for the 130-mile Central Valley segment, leaving roughly $4 billion of Proposition 1A money for future HSR construction.

The new strategy has evolved from discussions held by the High Speed Rail Authority’s new chairman, Dan Richard with the Governor and his fellow board members. In a conversation we had with Chairman Richard several weeks ago, he was frank to admit that significant changes must be made in the Authority’s way of doing business if the bullet train project is to retain the support of the state legislature, overcome the skepticism of independent critics and turn around public opinion. The Authority must find ways, in the Governor’s words, to do things “better, faster and cheaper.”

While supportive of the Governor’s vision, Richard saw a need to show signs of near-term progress and not have to wait until 2033 to demonstrate the benefits of the investment. The dollars spent on the “bookends” could have “an immediate and dramatic effect,” he told us.

Turning to the Central Valley project, Richard freely admitted the ham-handed way in which the Authority dealt with the affected property owners and local governments. He made plain his resolve to restore trust and rebuild the agency’s credibility with the Valley constituencies. We also were struck by his refreshing willingness to reach out to the program’s critics, in contrast to the Authority’s often arrogant and dismissive posture of the past.

Richard’s new strategy is beginning to bear fruit. Six Southern California planning and transportation agencies, including the Southern California Regional Rail Authority (Metrolink) voted as a group on March 1 to support the development of high-speed rail “while providing funding for local early investment projects in Southern California that will improve rail service immediately.” The Authority hopes to stimulate similar expressions of support in Northern California by working closely with the Bay Area’s Caltrain and San Francisco’s Municipal Transportation Agency. The Peer Review Group, which has long supported the “bookends” approach, can be expected to provide an additional boost to Richard’s strategy.

As for the initial Central Valley segment, its construction, initially planned to begin in September, has been pushed back. The slowdown is due to the need to revisit the environmental report whose initial version has run into a storm of objections concerning the proposed route. The revised draft report will be subject to another round of public hearings before the route through the valley is finalized. Assuming the state legislature authorizes the bond funding, construction in the Central Valley is now expected to begin in early 2013, although court challenges may cause further delays. Critics are expected to continue questioning the value of that investment, fueling continued controversy and increasing the project’s vulnerability.

A New Perception

Regardless of what ultimately becomes of the Central Valley project, the new urban “bookends” strategy is bound to profoundly modify the public perception of the bullet train venture. While the Governor and Chairman Richard maintain that the ultimate year 2033 goal of a 2 hour 40 minute train trip from LA to San Francisco has not changed, the practical effect of the new strategy will be to shift the focus from achieving that distant vision to effecting concrete near-term improvements— investments designed to benefit millions of present-day commuters in California’s two largest metropolitan rail corridors.

Given California’s budget deficit, given the uncertainty of further federal support for high-speed rail in general and for California’s HSR project in particular (see below), and given a lack of any evidence of private investor interest, the”bookend” program of investments may indeed end up as the key accomplishment of the Proposition 1A initiative. While bullet train visionaries will regret this shift in the focus, pragmatists will welcome it as a prudent and realistic response to the growing skepticism. From an economist standpoint, the bookend strategy will be viewed as the best use of scarce financial resources. The public will see it as a victory for common sense: a decision that wisely places greater value on satisfying present-day needs than on the promise of distant-in-time benefits.

Could Washington come to the rescue?

Meanwhile, in Washington, the Administration continues pursuing its fantasy-land rhetoric. “We envision an America in which 80 percent of people have access to high-speed rail,” Transportation Secretary Ray LaHood reiterated in a recent blog. “We’re committed to this program… there’s no going back… we will keep the momentum going” he stated at a February 29 high-speed rail conference sponsored by the U.S. High Speed Rail Association.

Except that this momentum, if there ever was one, has long since vanished. No funds for high-speed rail have been provided two years in a row, including the current (FY 2012) year. Nor are any HSR funds likely to be appropriated in the next year’s budget. Congressional reaction to the Administration’s $2.5 billion HSR request in its FY 2013 budget submission has ranged from cool to dismissive. The President’s high-speed rail program is “a vision disconnected from reality” members of the Senate Budget Committee told Sec. LaHood at a recent hearing on the Administration’s transportation budget.

Rep. John Mica (R-FL), chairman of the House Transportation and Infrastructure Committee was even more blunt. “If the president thinks his proposal for high-speed rail is going to fly, he’s pipe-dreaming,” he told participants at the February 29 rail conference. In short, all signs point to continued congressional unwillingness to support a federal high-speed rail program. This sentiment seems to cross party lines: neither the Republican-controlled House nor the Democratic-led Senate have included HSR funds in their reauthorization bills. Rep. Jeff Denham’s (R-CA) bill would specifically prohibit new federal funds from going to California’s bullet train project during the entire life of the bill.

For California, the implications are grave. Without further federal funds, the State of California will be obliged to seek a fresh infusion of public and private funds by 2015 if it is to continue pursuing its $98 billion bullet train vision. Will a new bond initiative or a public-private partnership succeed? Time alone will tell.

(Ken Orski is a Public Policy Consultant and former Principal of the Urban Mobility Corporation. ) CW